DIB Group Pty Ltd t/as Hill & Co v Cole - [2009] NSWCA 210

NEW SOUTH WALES COURT OF APPEAL

CITATION:
DIB GROUP PTY LTD Trading as Hill & Co v COLE [2009] NSWCA 210

FILE NUMBER(S):
40339/08

HEARING DATE(S):
12 June 2009

JUDGMENT DATE:
24 July 2009

PARTIES:
DIB Group Pty Ltd Trading as Hill & Co (Appellant)
Scott Cole (Respondent)

JUDGMENT OF:
Beazley JA McColl JA Basten JA

LOWER COURT JURISDICTION:
District Court

LOWER COURT FILE NUMBER(S):
DC 1325/07

LOWER COURT JUDICIAL OFFICER:
Goldring DCJ

LOWER COURT DATE OF DECISION:
19 September 2008

LOWER COURT MEDIUM NEUTRAL CITATION:
[Scott Cole v DIB Group Pty Ltd trading as Hill & Co] [2008] NSWDC 201

COUNSEL:
Mr R A Cavanagh (Appellant)
Ms S Norton SC/Ms I Ryan (Respondent)

SOLICITORS:
Boyd House & Partners (Appellant)
Brydens Law Office (Respondent)

CATCHWORDS:
TORTS – negligence – apportionment of responsibility – scope of employer's obligation to ensure safe system of work – danger on land not occupied by employer – absence of control over dangerous premises – whether obligated to undertake site inspection – whether causal connection between breach and injury
TORTS – negligence – contributory negligence – dangerous pit cover – whether aware of risk or ought reasonably to have been aware
WORDS & PHRASES – "non-delegable duty"

LEGISLATION CITED:
[Civil Liability Act 2002] (NSW), ss 3B, 5B, 5C, 5R
[Workers Compensation Act 1987] (NSW), 151E; Pt 5 Div 3

CATEGORY:
Principal judgment

CASES CITED:
[Atkinson v Gameco (NSW) Pty Ltd] [2005] NSWCA 338
[Bourke v Hassett] [1998] VSCA 24; [1999] 1 VR 189
[Davie v New Merton Board Mills Ltd] [1959] AC 604
[Electric Power Transmission Pty Ltd v Cuiuli] [1961] HCA 3; 104 CLR 177
[Estate of the late M T Mutton v Howard Haulage Pty Ltd] [2007] NSWCA 340
[Esso Australia Ltd v Victorian WorkCover Authority] [2000] VSCA 74; [2000] 1 VR 246
[Kondis v State Transport Authority] [1984] HCA 61; 154 CLR 672
[Maricic v Dalma Formwork (Australia) Pty Ltd] [2006] NSWCA 174
[Northern Sandblasting Pty Ltd v Harris] [1997] HCA 39; 188 CLR 313
[Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd] [1986] HCA 34; 160 CLR 626
[Pollard v Baulderstone Hornibrook Engineering Pty Ltd] [2008] NSWCA 99; 172 IR 453
[Sinclair v William Arnott Pty Ltd; Kell & Rigby Pty Ltd (Third Party) (No 2)] (1963) 64 SR (NSW) 88
[Smith v Austin Lifts Ltd] [1959] 1 WLR 100
[TNT Australia Pty Ltd v Christie] [2003] NSWCA 47; 65 NSWLR 1
[Wilsons and Clyde Coal Co v English] [1938] AC 57

TEXTS CITED:

DECISION:
(1) Dismiss the appeal.[ ][ ](2) Order that the appellant pay the respondent’s costs of the appeal.

JUDGMENT:

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40339/08
DC 1325/07
BEAZLEY JA
McCOLL JA
BASTEN JA
24 July 2009

DIB GROUP PTY LTD Trading as HILL & CO v COLE

Headnote

On 30 June 2005 Mr Cole ("the plaintiff") was delivering fuel to the premises of DIB Pty Ltd ("the appellant"). Whilst returning to his truck after adjusting valves which were required to be opened to discharge the fuel into tanks, the plaintiff stepped on a cover over an inspection pit. The general area was covered in gravel, and the cover was surrounded by sections of pine log raised approximately four inches above the gravel surface. At some point in time, the edges of the concrete rim on which the cover rested had been chipped away so as to grant easier access to the pit. When the plaintiff trod on the pit cover it moved, resulting in him falling into the pit and suffering a complex fracture of the left ankle.
The plaintiff brought proceedings against the appellant in the District Court, where Goldring DCJ awarded him damages for injury arising out of the appellant's negligence. The appellant appealed to the Court of Appeal against his Honour's findings as to contributory negligence and employer's liability.
The issues for determination on appeal were:

whether the plaintiff had been contributorily negligent, and
whether the plaintiff's employer was also liable in negligence, and would, if sued by the plaintiff, have been liable for contribution to the appellant.

The Court held, dismissing the appeal:

In relation to (i):
(per Basten JA, Beazley and McColl JJA agreeing)

The risk of injury which materialised was not one of which the plaintiff was aware or ought reasonably to have been aware: [19].

In relation to (ii):

(per Basten JA, Beazley and McColl JJA agreeing)

The employer's duty, however effected, to adopt safe systems of work and to provide proper plant and equipment, will operate differently on premises and in circumstances over which it has full control, as opposed to those which are under the control of others. The concept of control is multi-faceted; evidence of control may impose liability on a non-employer, whilst absence of control need not justify removing liability from an employer. It is appropriate to ask quite specific questions as to what may be expected of any employer in such circumstances: [41], [54]–[55].
Kondis v State Transport Authority [1984] HCA 61; 154 CLR 672; Northern Sandblasting Pty Ltd v Harris [1997] HCA 39; 188 CLR 313; Estate of the late M T Mutton v Howard Haulage Pty Ltd [2007] NSWCA 340; Atkinson v Gameco (NSW) Pty Ltd [2005] NSWCA 338; TNT Australia Pty Ltd v Christie [2003] NSWCA 47; 65 NSWLR 1; Bourke v Hassett [1998] VSCA 24; [1999] 1 VR 189; Wilsons and Clyde Coal Co v English [1938] AC 57; Davie v New Merton Board Mills Ltd [1959] AC 604; Smith v Austin Lifts Ltd [1959] 1 WLR 100, considered.
Electric Power Transmission Pty Ltd v Cuiuli [1961] HCA 3; 104 CLR 177; Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd [1986] HCA 34; 160 CLR 626; Pollard v Baulderstone Hornibrook Engineering Pty Ltd [2008] NSWCA 99; 172 IR 453; Sinclair v William Arnott Pty Ltd; Kell & Rigby Pty Ltd (Third Party) (No 2) (1963) 64 SR (NSW) 88; Esso Australia Ltd v Victorian WorkCover Authority [2000] VSCA 74; [2000] 1 VR 246, referred to.
The duty of the plaintiff's employer included an obligation to carry out a site inspection, however a reasonable inspection would not have disclosed the risk of injury, and thus there was no causal connection between the breach of the duty by the employer and the injury suffered by the plaintiff: [56], [60], [63].

IN THE SUPREME COURT

OF NEW SOUTH WALES
COURT OF APPEAL

CA 40339/08
DC 1325/07
BEAZLEY JA
McCOLL JA
BASTEN JA
24 July 2009

DIB GROUP PTY LTD Trading as HILL & CO v COLE

Judgment

BEAZLEY JA: I agree with Basten JA.
McCOLL JA: I agree with Basten JA.
BASTEN JA: On 30 June 2005 Mr Scott Cole (“the plaintiff”) was delivering fuel to premises at Braidwood Road, Goulburn in southern New South Wales. Whilst returning to his truck after adjusting valves which were required to be opened to discharge the fuel into tanks, the plaintiff stepped on a cover over an inspection pit. The pit cover moved when the respondent trod on it resulting in him falling into the pit and suffering a complex fracture of the left ankle.
The plaintiff took proceedings in the District Court against the present appellant, as the occupier of the premises where the accident occurred. The appellant was found liable to the plaintiff in negligence by Goldring DCJ, who awarded him damages in the amount of $318,719.23: Cole v DIB Group Pty Ltd Trading as Hill & Co [2008] NSWDC 201.
The present appeal involves no challenge to the finding that the appellant was liable in negligence, nor to the assessment of damages. Rather, it challenges two respects in which the appellant was unsuccessful at trial, namely:
(a) a claim that the plaintiff was contributorily negligent, and
(b)a claim that the plaintiff’s employer was also liable in negligence and would, if it had been sued by the plaintiff, have been liable to contribute to the damages payable by the appellant.

General background

At the time of the accident, the plaintiff was 38 years of age. He had many years of experience as a driver of commercial vehicles. During the 12 months prior to the accident, he had been employed as a driver by a company referred to in the evidence as Lewingtons, which had been bought in July 2004 by Finemore Transport. He had been driving a fuel tanker during that period visiting the appellant’s depot on numerous occasions. In some weeks he stated that he made deliveries to the depot once a day, but at other times there might not be a delivery all week: Tcpt, 15/09/08, p 40(15). On each occasion he was required to discharge fuel into a tank, although the tank varied depending upon the kind of fuel being delivered. In the first two weeks of the work he had been given instruction in basic safe handling procedures and had been shown how to open and close valves on the appropriate tanks: Tcpt, p 38. That activity involved parking the tanker on a tarmac apron, connecting the tanker to the relevant pipes and then walking around an area with large above-ground pipes, and across some 20 metres of pebbled area to the valves, and back to the truck.
On the pebbled area was a pit which his Honour described as “about 60-80 cm square”: at [5]. The metal lid to the pit was designed to rest upon a concrete rim within the pit. However, the pit was required to be inspected or cleaned by employees of the appellant on a weekly basis. At some unidentified time, employees of the appellant had chipped away the concrete at the corners of the rim so as to allow the lid to be more readily lifted by applying downward pressure on one corner. This course had, inevitably, made the lid unstable if someone inadvertently trod on one corner.
At the time of the accident, the pit, together with another near it, was surrounded by what appear to have been quarter sections of pine logs having a radius of about 15 cm. The plaintiff referred to them as “approximately about 4 inches high”: Tcpt, p 44(20).
The plaintiff gave evidence that he had walked across the area at least 50 times and had not stepped on the pit lid prior to the day of the accident. He could not say why he had not walked on it before and could not say that he had made a decision as a result of ever considering whether to walk on it or around it: Tcpt, p 40(38) and 41(25).
Although the delivery took place at 6.40am on 30 June, his Honour accepted that the light would have been poor, but that there would have been some light. The plaintiff did not suggest that he did not see the pit cover: p 43(10). The evidence continued:
“Q.You say [saw] it and you decided to walk on it, is that right?
A. No.
Q. Are you saying you didn’t decide to walk on it?
A.Well I’m saying I didn’t consciously make a decision to step on it or not.
The plaintiff also gave evidence that he had seen outside the Court two men whom he knew by name, who worked for the appellant. One, whom he identified as Craig Gray, he knew as a “load allocator” at the depot. He gave the following evidence as to a conversation with Mr Gray (Tcpt, p 17):
“Q.Before this accident occurred to you did the load allocator ever tell you to watch out for the lid on the pit, the one you came to grief on?
A. No.
Q.Did he ever tell you he himself had fallen in there on an earlier occasion?
A. No.
Q.What about after the accident? Did you have a conversation with him about any accident in which he’d been involved?
A.On the morning of the accident when I waiting for the ambulance to come to take me to the hospital, Craig arrived and he said to me that morning that he’d also fallen into the same hole.”
There was some discussion in the course of argument as to the timing of Mr Gray’s accident, it being suggested that it had occurred on the morning of the plaintiff’s accident. Read in context, that is clearly not the effect of the evidence: the preferable construction of the plaintiff’s answer is that it was the plaintiff’s accident which had caused Mr Gray to recount to him on that morning, an earlier accident that had occurred to Mr Gray. When that accident occurred is unclear, but it was not on the morning of the plaintiff’s accident.
In addition to his own evidence, the plaintiff called Ms Joanne Skelly, who was the occupational health and safety manager with Finemore Transport. She gave evidence that she had attended at the appellant’s premises on the day after the accident. She said that when she arrived the pit lid was “still tipped down within the pit”: Tcpt, 15/09/08, p 56. She noted that it was a shallow pit, approximately 20 cm deep, which appeared to be designed for stormwater: p 57. She inspected the site in company with Mr Roland Byrd who was an employee of the appellant. She gave evidence with respect to the concrete rim of the pit at p 58(20)-(30):
“Q.Did you notice anything about the concrete edge of the pit on which the lid should have sat?
A.Around the corners it looked like [what] they’d done was chip a bit of it away because what they – what I was told was that they were having problems lifting the lid.
Q. Who told you that?
A.The employees in the yard and so to do that what they did was chip a bit away so it was easier for them to lift the – lift the lid up because it had to be cleaned out every week.
Q.When the lid was sitting on the lip, chipped away as it was, did you notice anything about the stability of the lid, depending on where pressure was applied to it?
A. If you put pressure on the corner of it, it would kick up.”
Ms Skelly then gave evidence of a conversation with Mr Byrd and Mr Bryce Gray, who was the operations manager at the appellant’s depot. Counsel for the appellant cross-examined Ms Skelly as to what she might have done had she gone to the appellant’s premises to carry out a safety check before the accident. Her evidence in that respect was relied upon by the appellant and may conveniently be set out in full (Tcpt, p 62):
“Q.… when had you been out there before the accident?
A.I hadn’t been out there before the accident. I had been out to the yard but I had not completed a risk assessment on the site. We had a driver induction and we had a depot induction.
Q.I suppose it’s fair to say often with the benefit of hindsight that if you carried out a risk assessment and knew that the pit cover was in any way liable to fall in you might have taken steps to prevent it?
A.Well you would have but then too unless you walked on that pit – on that cover you wouldn’t know that the cover was in the condition that it was, you would class it more as a trip hazard.
Q.You I think a minute ago said that, correct me if I’m wrong because I’m going from memory, that the truck drivers were required to walk over the pit, that right?
A.           Yep.
Q.In ordinary circumstances you wouldn’t consider it a safe means of access to require anyone to walk over a pit would you?
A.           No.
Q.So I suppose again that if you’d been out there beforehand and formed the view that the truck driers were required to walk over the pit you would have done one of two things. One you would have told your truck drivers not to walk over the pit, yes?
A.           Yep.
Q.And two you would have ensured that the pit lid was safe and secure?
A.           True.
Q.           Is that right?
A.           Yep.
Q.Now we’ve heard evidence that a Mr Arthur Goodall was out there about a year beforehand, what was his role within Finemores?
A.           He was a driver trainer.
Q.You would have expected him, would you to impress upon your employees that they weren’t to walk over pits?
A.           Yes.
Q.Indeed if he didn’t do that you’d think that was a failing on his part?
A.Yes and part of it too was that if Arthur spotted anything that he thought was unsafe or any near misses he was to report them immediately.”
There were aspects of this evidence which were open to differing inferences. First, it is clear from the second question and answer that the cross-examiner was both identifying a hypothetical situation and noting that the answers might be given “with the benefit of hindsight”. Secondly, as the answer to the second question indicated, Ms Skelly saw the risk arising with respect to the pit cover as “a trip hazard”. At least the subsequent three questions and answers may well have been based on that premise.

Contributory negligence

The trial judge dealt with the suggestion of contributory negligence briefly, making passing reference to the Civil Liability Act 2002 (NSW), s 5R. His Honour stated that “although the pit had a wooden border, there was absolutely nothing to indicate that it was not safe for a person to place weight on the pit cover”: at [10].
Section 5R relevantly provides:
“5R Standard of contributory negligence
(1)The principles that are applicable in determining whether a person has been negligent also apply in determining whether the person who suffered harm has been contributorily negligent in failing to take precautions against the risk of that harm.
(2) For that purpose:
(a)the standard of care required of the person who suffered harm is that of a reasonable person in the position of that person, and
(b)the matter is to be determined on the basis of what that person knew or ought to have known at the time.”
The reference to principles applicable to determining whether a person has been negligent appear to pick up, relevantly for present purposes, the principles stated in ss 5B and 5C which provide as follows:
“5B General principles
(1)A person is not negligent in failing to take precautions against a risk of harm unless:
(a)the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and
(b)the risk was not insignificant, and
(c)in the circumstances, a reasonable person in the person’s position would have taken those precautions.
(2)In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things):
(a)the probability that the harm would occur if care were not taken,
(b)the likely seriousness of the harm,
(c)the burden of taking precautions to avoid the risk of harm,
(d)the social utility of the activity that creates the risk of harm.
5C Other principles
In proceedings relating to liability for negligence:
(a)the burden of taking precautions to avoid a risk of harm includes the burden of taking precautions to avoid similar risks of harm for which the person may be responsible, and
(b)the fact that a risk of harm could have been avoided by doing something in a different way does not of itself give rise to or affect liability for the way in which the thing was done, and
(c)the subsequent taking of action that would (had the action been taken earlier) have avoided a risk of harm does not of itself give rise to or affect liability in respect of the risk and does not of itself constitute an admission of liability in connection with the risk.”
Whatever the benefits for drafters in adopting this technique of incorporation by reference, the results are not always as expected. The circumstances relevant to the liability of an occupier of premises or persons conducting a business are likely to be quite different from those of an occasional visitor or even an employee of the business. However, it is not necessary to consider in any detail the operation of these provisions for the purposes of this case. The risk of injury which materialised was not, as his Honour found, one of which the plaintiff was aware or ought reasonably to have been aware. Stepping on metal pit covers is an everyday experience and does not, or should not, carry with it any significant degree of risk. The only matter which might differentiate the present circumstance from the more general situation was the timber surround of the pit cover. However, its purpose was unclear and it carried with it no express or implicit warning that the pit cover was dangerous to tread on. Its probable purpose was to limit the possibility of the surrounding pebbles being kicked onto the pit cover or into the pit.

In dismissing the defence of contributory negligence in a short paragraph, the trial judge dealt with these matters somewhat perfunctorily. Nevertheless, nothing more was required in the circumstances. This ground of appeal should be rejected.

Responsibility of employer

His Honour also dealt briefly, though in a little more detail, with the liability of the plaintiff’s employer.
The amended defence did not actually identify who the employer was but merely stated in paragraph 10A:
“In further answer to the whole of the Amended Statement of Claim, the First Defendant says that, if the Plaintiff is entitled to damages as against the First Defendant (which is denied) the First Defendant is entitled to a reduction in those damages by the amount by [sic] which the Plaintiff would have been entitled to recover from his employer as a joint tortfeasor and the First Defendant relies on section 151Z of the Workers Compensation Act, 1987.”
Counsel for the appellant told the Court that this pleading was in a form commonly used. If so, that is unfortunate. It made no attempt to plead in what way the employer was negligent or what steps should reasonably have been taken by the employer in exercise of a duty to take reasonable care for the safety of its employee. The appellant tendered no evidence relevant to this issue in its defence. The only material on which it sought to rely was the evidence of Ms Skelly, an employee of the plaintiff’s employer, who was called by the plaintiff. The critical passage upon which reliance was placed is set out above at [14].

Duty of employer – legal principles

The civil liability of the employer for injury to a worker would give rise to an award of damages to which Pt 5 Div 3 of the Workers Compensation Act 1987 (NSW) applied: s 151E(1). Accordingly, the Civil Liability Act did not apply: Civil Liability Act, s 3B(1)(f). The principles to be applied in determining the liability of an employer to its employee in negligence depended upon the general law, unaffected by statute.
The authorities, including those discussed below, suggest that matters relevant to the scope of an employer’s duty to take reasonable care for the safety of its employee can often be identified by reference to the following questions:
(1)Did the circumstances which gave rise to the employee’s injury require some antecedent conduct on the part of the employer which was not taken?
(2)If so, did the conduct fall within the scope of the obligation –
(a)          to provide proper and adequate plant and equipment;
(b)          to engage reasonably competent workers or contractors, and
(c)          to provide a reasonably safe system of work?
(3)If so, and the circumstances were within the immediate control of the employer, did the employer fulfil those requirements, either itself, or through its employees, agents or contractors?
(4)If the circumstances were not within the immediate control of the employer, did the employer take such steps as were reasonable in all the circumstances, to provide reasonable protection to its employees?
It is usually preferable to treat question (1) as a preliminary issue, in circumstances where it arises. Injuries undoubtedly occur where no antecedent steps were required on the part of the employer. Although standards of safety have undoubtedly improved over the decades, it may still be the case that the employer of a worker in the bush, cutting wood with a hatchet, is not required to give instructions or warnings: see Electric Power Transmission Pty Ltd v Cuiuli [1961] HCA 3; 104 CLR 177. Further, the fact that an employer may be liable for the negligent conduct of an employee in the course of employment, does not necessarily mean that the employer will be required to give directions or exercise control over the employee, who may well have specialist skills and expertise relevant to the work in question.
There are numerous cases which refer to the employer’s duty as “stringent” and “non-delegable”. Neither of these epithets is entirely helpful, despite the authority to be gained from common usage. The term “stringent” is unhelpful and inaccurate if it suggests a departure from a standard of reasonable care. The term “non-delegable” is often unhelpful, at least in part, because of the uncertainty attaching to the concept of delegation.
As explained by Lord Wright in Wilsons and Clyde Coal Co v English [1938] AC 57 at 79-80 the distinction sought to be encompassed in such a description was between the “personal” duty of the employer and the liability for negligence of a fellow employee, against which the doctrine of “common employment” then provided a defence. Even then, his Lordship provided a prescient warning against the current fashionable label (at 83-84):
“There is perhaps a risk of confusion if we speak of the duty as one which can, or cannot, be delegated. The true question is, What is the extent of the duty attaching to the employer? Such a duty is the employer’s personal duty, whether he performs or can perform it himself, or whether he does not perform or cannot perform it save by servants or agents. A failure to perform such a duty is the employer’s personal negligence. This was held to be the case where the duty was statutory and it is equally so when the duty is one attaching at common law.”
In an earlier passage his Lordship had identified the common law principle in the following terms (at 78):
“The same principle, in my opinion, applies to those fundamental obligations of a contract of employment which lie outside the doctrine of common employment, and for the performance of which employers are absolutely responsible. When I use the word absolutely, I do not mean that employers warrant the adequacy of plant, or the competence of fellow employees, or the propriety of the system of work. The obligation is fulfilled by the exercise of due care and skill. But it is not fulfilled by entrusting its fulfilment to employees, even though selected with due care and skill.”
He continued, in explanation of the error of the Court of Appeal, that to suggest that the obligation to provide a safe system of work could be fulfilled by the employment of competent managers would be to collapse the second and third limbs of the obligation (as articulated at [25] above into one. The rejection of that attempt has given rise to the description of the employer’s duty as “non-delegable”.
That analysis leaves open, however, the true scope of the employer’s duty. Thus, in relation to the first limb of the duty, the provision of adequate plant and equipment, is it sufficient that an employer purchase plant and equipment from reputable suppliers? In relation to the second limb, is it sufficient that the employer hire reputable contractors to maintain the plant and equipment? Alternatively, is the employer liable if either the manufacture or maintenance is carried out negligently?
The first question was addressed by the House of Lords in Davie v New Merton Board Mills Ltd [1959] AC 604. In that case, a maintenance fitter suffered an injury when a piece of metal came off a tool he was hammering and lodged in his eye. The tool was purchased by his employer from a reputable supplier and had been manufactured by reputable makers; nevertheless, the manufacture was negligent and the question was whether the employer was liable to the employee, in circumstances where the defect was neither apparent nor discoverable by reasonable inspection on the part of the employer. The claim of liability put by the appellant was described by Lord Reid as a “somewhat startling proposition”: at 630. After a review of the authorities, Lord Reid concluded at 645-646:
“The conclusion to which I have come is that an employer, besides being liable to his servant for injury caused by the negligence of his own servants, is in some cases liable in respect of the negligence of others. Where, then, is the line to be drawn? On the one hand it appears that an employer is liable for the negligence of an independent contractor whom he has engaged to carry out one of what have been described as his personal duties on his own premises and whose work might normally be done by the employer’s own servant – at least if the negligent workmanship is discoverable by reasonable inspection. On the other hand, for the reasons which I have given, I am of opinion that he is not liable for the negligence of the manufacturer of an article which he has bought, provided that he has been careful to deal with a seller of repute and has made any inspection which a reasonable employer would make.”
The second question, with respect to maintenance of equipment and plant, was considered in TNT Australia Pty Ltd v Christie [2003] NSWCA 47; 65 NSWLR 1. Christie involved two separate issues concerning the liability of the worker’s employer. The first concerned the duty of the employer (Manpower), as a labour hire company; the second concerned its liability, and that of the business for which the employee was working, TNT, for an injury caused by a moveable pallet jack, which was a type of forklift: at [6] and [7]. The jack was owned by Crown Equipment Pty Ltd (“Crown”), which leased it to TNT Australia, but remained responsible for maintenance and repair. Both Manpower and TNT sought to rely upon the latter’s engagement of Crown as a skilled and reputable servicing company, together with TNT’s system for reporting and attending to malfunctions: at [74]. A technician from Crown had responded to a complaint about a fault in the equipment and had apparently fixed the fault prior to the accident.
Mason P concluded at [92]:
“The finding that Crown was negligently at fault in failing to detect and/or repair the cause of the problem reported to it is sufficient to render TNT and Manpower liable, in light of the non-delegable duties each owed to the plaintiff. There was a want of care in the maintenance of the plant which employees were directed to use at the workplace.”
That conclusion was not adopted by Davies AJA, who stated at [150]:
“I prefer to leave open any issue concerning the repair of plant which it is beyond the skill and ability of the employer to carry out and which must be carried out, for example, in premises and in the course of a business over which the employer has no control.”
It is not clear what findings his Honour made with respect to Manpower (the employer), although he agreed in orders that Manpower’s appeal should be dismissed with costs: at [145] and [173].
Foster AJA, in separate reasons, agreed with Mason P. He held that both Manpower and TNT owed non-delegable duties to the plaintiff which were not fulfilled if Crown were shown to be negligent, as his Honour held that it was: at [175]-[178], [183] and [197].
The scope of the employer’s duty is often identified by reference to the statement of Mason J in Kondis v State Transport Authority [1984] HCA 61; 154 CLR 672. In that case a worker was injured on his employer’s premises by the act of an independent contractor also working on the premises. As Mason J acknowledged, the case might have been decided on the basis that the employer was directly liable because its own foreman had failed to direct the plaintiff not to stand under the jib of the crane during the jib extension procedure, being a direction which remained within his power, although the plaintiff was working for the independent contractor (under the instruction of its employee, Clissold) in assisting with its operation: at 688-689. An alternative way, and the primary way in which the matter was dealt with in the High Court, was to uphold the plaintiff’s claim against his employer on the basis that it had allowed the independent contractor (and its employee, Clissold) to adopt a system of work and was directly liable in circumstances where the contractor had failed to adopt a safe system: at 688. His Honour stated:
“If control of this operation was in the hands of Clissold then it was for him to adopt a safe system of work. The respondent is liable for his neglect, not on a vicarious basis, but because Clissold’s omission to adopt a safe system is a breach of the respondent’s duty. Although Clissold was guilty of casual negligence, as it is often called, in failing to keep an adequate look out and to give warning, his omissions in these respects do not inhibit the conclusion that there was a breach of the respondent’s duty to provide a safe system of work.”
The application of these principles has given rise to differing views in cases where the employer is not in control of the premises or place on which or at which the worker is injured. The relevance of that consideration was recognised by Lord Reid in Davie, in the passage set out at [32] above, his Lordship limiting the principle of liability to a case of the negligence of an independent contractor which the employer has engaged to carry out “what have been described as his personal duties on his own premises …”.
It is arguable that the scope of the employer’s obligation has been expanded, as was recognised by Mason J in Kondis at 679 and 684, by the imprecise nature of the distinction between those duties and activities of the employer which are personal duties and those which are not. In particular, the concept of a “safe system of work” may have expanded somewhat over the years so as to include responsibility for “casual negligence” of independent contractors; the absence of vicarious liability is bypassed by identifying the breach of duty as a failure to adopt a safe system of work. However, the relevant question for present purposes is the extent to which the personal duty of the employer extends to premises over which it has limited or no control.
Before reviewing those authorities, it is appropriate to note that the concept of “control” has a number of different facets. On the one hand, evidence of control may justify imposing liability on a non-employer; on the other hand, absence of control need not form a basis for removing liability from an employer. The duty is not based upon an assumption that the employer personally has either the knowledge or ability to perform the duty. As noted by Lord Wright in Wilsons and Clyde Coal, at 80-81:
“It is difficult to see what that duty would mean in the case of an absentee or infant or inexpert employer, or what it would mean in the case of a great modern industrial concern. … If I may take an analogy or instance of a similar personal obligation, I note that the Carriage of Goods by Sea Act, 1924, requires a shipowner to exercise due diligence or to take reasonable care to provide a seaworthy ship. The shipowner is almost certainly not an expert naval architect, engineer or stevedore. So far as I know it has never been claimed that this obligation is fulfilled by the shipowner taking reasonable care to appoint a competent expert ….”
To similar effect, albeit in relation to liability for the negligence of the employee, Deane J in Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd [1986] HCA 34; 160 CLR 626 at 676 noted that the “specialist employee … has become almost as much the rule as the exception”. His Honour continued:
“His specialist knowledge will commonly be such that it will be impracticable for his employer to do more than satisfy himself about, and rely upon, the qualifications, experience and reputed competence of the employee as a trained and licensed expert in the particular field. Nonetheless, the law is now clear that such a general employer will ordinarily be vicariously liable for such an employee's negligence in the course of the ordinary discharge of the duties of his employment.”
The tension between a duty, limited to reasonable care, and non-delegability, arises where an employer sends an employee to work at premises not under the employer’s control or using equipment other than that supplied by the employer. These are sometimes identified as “relevant facts” in determining the scope of the employer’s duty and whether it has been breached: see, eg, Bourke v Hassett [1998] VSCA 24; [1999] 1 VR 189 at [41] (Winneke P, Brooking and Buchanan JJA agreeing). In Bourke, the employee was injured whilst working horses on a course controlled by the Victorian Racing Club (“the VRC”). The employer was familiar with the track and should have been aware of the particular danger posed. Winneke P stated at [42]:
“In those circumstances it was, in my view, incumbent upon a prudent employer to consider whether the risk to his employee could be avoided or minimised by the employment of reasonable means, notwithstanding the occupier's control over the condition of the crossing. It was not, in my view, a sufficient performance of the duty, as it would appear his Honour found, to forego the exercise of any independent control of the way in which his employee worked the horses on the course simply because he was entitled to consider that the course was in the hands of experts. This was, in my view, tantamount to suggesting that the employer was justified in delegating his personal duty as employer to the VRC. This, of course, the employer was not entitled to do ….”
Atkinson v Gameco (NSW) Pty Ltd [2005] NSWCA 338 involved an employee who had been sent to Thailand to promote sales of his employer’s product. When on the premises of the Thai company, he asked if he could look inside a tanker of a kind being manufactured by the company and was directed towards a particular tanker with a ladder at the back. The ladder was not fully attached and, when the plaintiff commenced to climb, gave way, causing him serious back injuries. There was no dispute that the employee of the Thai company was negligent in directing the plaintiff to climb the particular ladder. Ipp JA (with whom Giles JA and Hunt AJA agreed) stated that “the fact that the premises are in the control of a third party will be a relevant matter when considering whether the employer has taken reasonable care for the safety of the employee”: at [18]. The absence of an opportunity for the employer to inspect the premises, the relatively short duration of the visit, the employer’s lack of knowledge of the particular danger and its incapacity to shield its employee from the danger were held to result in “the scope or content of [the employer’s] duty of care not extending to the state of the premises of the Thai company or its plant or equipment or its systems of work”: at [21].
In Christie, TNT, on whose premises the employee was injured was treated as having a similar responsibility to the employee of another as to its own employees and, there being negligence on its part, the labour hire company, as the legal employer, was also held to be liable. Whether that reasoning was accepted and applied in Atkinson is less clear. To describe the question of control as a “relevant fact” has the potential to reformulate the question as to whether the employer took reasonable care, rather than the question whether the person under whose control the employer placed its employee took reasonable care.
The question of control was also treated as critical in the assessment carried out by the majority in Estate of the late M T Mutton v Howard Haulage Pty Ltd [2007] NSWCA 340 at [146] (Ipp JA, Hodgson JA agreeing; Spigelman CJ dissenting). The facts involved an accident causing injury to a truck driver whilst delivering grain to a farm owned by the appellant. The appellant brought a cross-claim against the driver’s employer, seeking contribution on the basis of its breach of duty. As noted by the Chief Justice, a critical factor with respect to that issue was that “the activities of the Respondent’s employees were to be conducted at different locations with a range of different equipment configurations to be supplied by the farmers”: at [5]. His Honour considered that fact “relevant, but not determinative” of the employer’s liability. Critical to his Honour’s finding that there was liability on the part of the employer, appears to have been identification of “the basic difficulty of the progressive diminution of the workspace” as “a common factor which would arise at all sites”: at [15]. The critical conclusion in the reasoning of Ipp JA, for the majority, was expressed in the following terms:
“146Devising and implementing a safe system of work would ordinarily not be an overly difficult task where the worker is working in the employer’s own premises. The situation is different where the employee delivers materials over vast distances to several different farms where workplaces, working conditions and equipment differ from farm to farm and where changes can be made at any time by the farmers concerned. In the latter situation, the employer has no real control over the circumstances in which each delivery is made. Due regard must be had to this absence of control when determining what amounts to the taking of reasonable care to avoid exposing employees to unnecessary risks of injury, and what amounts to a safe system of work.
147In the present case, it was not reasonably possible for the respondent to have devised and implemented a safe system of work dealing with the specific circumstances involving the appellant’s auger and the particular circumstances that obtained on the appellant’s farm. The respondent was not aware of those circumstances and, in my view, considerations of reasonableness did not require it to be aware of them. Additionally, the respondent had no control over the auger and was not in a position to take appropriate measures to guard it. That is not to say, of course, that the respondent did not owe [its driver] a duty of care …. The means by which the respondent was required to discharge that duty, however, must be determined by the particular circumstances.”

Hodgson JA, agreeing with Ipp JA, expressed the principle in the following terms at [53]:
“The facts of this case are similar in many respects to those in Czatyrko v Edith Cowan University [2005] HCA 14, (2005) 79 ALJR 839; but as both Spigelman CJ and Ipp JA have noted, there is the important difference that the accident in this case occurred at a property not under the control of the employer, by reason of a danger also not under the control of the employer, of which the employer had no knowledge.”
There were a number of curious aspects to the case. As noted by Ipp JA, the sole breach of duty alleged was that a specific instruction should have been given to the driver as to how to unload grain. Further, and of some importance in the application of the principles stated above, was the finding that the employer was not aware, and was not reasonably required to be aware of the circumstances in which this was to occur. Nevertheless, as his Honour further stated, “[t]here was no challenge to the finding that the respondent did not know about the hazard constituted by the unguarded auger. The appellants relied solely on imputed or constructive knowledge”: at [151]. It was clear that “the danger constituted by the auger was obvious to all who observed it (including [the driver and the farmer]) and [the driver] was well aware of it”: at [158]. If the knowledge of the driver were not to be imputed to the employer, it presumably did not matter whether the driver had such knowledge or not. In other cases, the knowledge of the employer has not generally been identified as critical to the existence or extent of the employer’s duty, nor to the question of breach. Thus, in Christie, there was no reason to suppose that the employer (Manpower) had any knowledge of the defective condition of the pallet jack, nor as to the steps taken to rectify the problem. There might also have been a question in Mutton as to whether an employer, which despatched its employees to various locations to deliver products, was obliged to make inquiries of its drivers as to the circumstances they faced in making deliveries, even if it were not required to conduct inspections itself. Because such questions appear not to have arisen on the pleadings, Mutton provides little by way of assistance in answering them.
There are many cases in which labour hire firms have been found liable to contribute to the damages suffered by a worker whose employment is carried out on premises which are not under the control of the employer. Indeed, such cases arose before labour hire firms became commonplace, as in the case of employees delivering goods to or providing services at the premises of customers of their employer: see, eg, Sinclair v William Arnott Pty Ltd; Kell & Rigby Pty Ltd (Third Party) (No 2) (1963) 64 SR (NSW) 88. Many of the cases were identified by McColl JA in Pollard v Baulderstone Hornibrook Engineering Pty Ltd [2008] NSWCA 99; 172 IR 453 at [33]-[52]. Pollard was the driver of a concrete agitator truck used in the supply of concrete for the construction of the M5 East Motorway: at [5]. Trucks were required to be washed to remove mud and debris before returning from the construction site to public roads. On some occasions construction site staff were available to wash the vehicles and the driver remained in the truck. On other occasions, drivers undertook that function. The plaintiff was injured when he slipped on metal rails when seeking to wash his vehicle. After discussing a number of cases in which labour hire firms had been found liable in respect of unsafe conditions on sites controlled by third parties, her Honour noted that at least two cases “were what might be called single-site cases, where it is apparent that the employer had had an opportunity to inspect the premises to which it had assigned its employee”: at [44]. She noted a submission by counsel that the employer of Mr Pollard sent its drivers to many destinations to deliver concrete. Her Honour then referred, with apparent approval, to the statement in Bourke v Hassett at [42] where Winneke P stated:
“One can conceive of a multitude of circumstances where workmen are sent to work upon premises controlled by others in which the impact upon the discharge of the employer’s duty will vary. It will depend no doubt upon such matters as the employer’s opportunity to inspect the premises, the length of time the employer has put his employees to work on the premises, the awareness in the employer of danger, his capacity to shield his employees from the danger and various other factors.”
Her Honour also noted that the liability of a labour hire firm had been held to extend to the conditions in relation to sleeping quarters for workers on a Bass Strait oil platform: Esso Australia Ltd v Victorian WorkCover Authority [2000] VSCA 74; [2000] 1 VR 246.
The modern case law with respect to the duty of employers which despatch employees to other places or premises, may be seen to commence with the judgment of Lord Denning in Smith v Austin Lifts Ltd [1959] 1 WLR 100 at 117, where his Lordship stated:
“Notwithstanding what was said in Taylor v Simms & Simms (1674 LT 414), it has since been held, I think rightly, that employers who send their workmen to work on the premises of others cannot renounce all responsibility for their safety. The employers still have an over-riding duty to take reasonable care not to expose their men to unnecessary risk. They must, for instance, take reasonable care to devise a safe system of work …; and if they know or ought to know of a danger on the premises to which they send their men, they ought to take reasonable care to safeguard them from it. What is reasonable depends, of course, on the circumstances.”
Smith v Austin Lifts Ltd was applied by this Court soon after it was delivered, in Sinclair v William Arnott (above at [49]). The judgment of the Court, delivered by Walsh J, stated at 92:
“The principle … to be derived from the authorities is that the duty of care is recognised as existing where employees are sent to work in another’s premises, and that what constitutes a failure to fulfil this duty must depend upon all the circumstances.”
The description of a duty as “non-delegable” appears to invoke a concept of “delegation”. In most circumstances, that language is inapposite. As explained by Toohey J in Northern Sandblasting Pty Ltd v Harris [1997] HCA 39; 188 CLR 313 at 350 (omitting footnotes):
“There has been criticism of the concept of a non-delegable duty in the law of tort. And there has been criticism of the expression itself on the footing that one cannot delegate a duty imposed by law; rather the question is whether the duty is personal or whether it can be discharged by engaging someone else to perform what has to be done. There is force in these criticisms but the concept is now part of the law as the expression is part of its vocabulary. It is the operation of the concept in the circumstances of the present appeal that is critical.”
The employer’s duty, however effected, to adopt safe systems of work and to provide proper plant and equipment, will operate differently on its own premises and in circumstances over which it has full control, as compared with premises under the control of others and circumstances over which it does not have control. Where the safety of premises is at stake, as in this case, it is appropriate to ask quite specific questions with respect to what may be expected of an employer exercising reasonable care for the safety of its employees. For example, is it reasonable for the employer to request or require access to premises to carry out its own safety inspection? Is it necessary (and sufficient) if the employer inquires of the occupier what steps it has taken to conduct such an assessment? Is it necessary (and sufficient) for the employer to inquire in specific terms of its own employees as to the nature of the conditions they encounter at other premises?
These questions are analogous to the approach to be adopted with respect to the acquisition of plant and equipment discussed in Davie. In such a case, it is not sensible, nor consistent with the requirement to take reasonable care, to treat the employer as “delegating” its duty to provide safe equipment to the manufacturer or supplier. So long as it has acted reasonably, the employer will not be liable for injury to its employee resulting from a defect in equipment or plant not identifiable by reasonable care on the part of the employer, even though the defect is the result of negligent manufacture.

Application of principles

In addressing the responsibility of the employer, his Honour referred to an argument based on the non-delegable duty of the employer to warn its employees to avoid walking over the pit cover, which was in fact unsafe due to the appellant’s negligence. His Honour described the employer’s duty as “onerous, even stringent, but it is not absolute”: at [14]. In effect, his Honour did not treat the issue as one of delegation, but concluded:
“It would not, I find, have been reasonable for Finemore’s [sic] to have lifted the pit cover to see that the corners had been chipped away. Even if there had been a site inspection, it was beyond any reasonable expectation that the defect in the concrete, that caused the pit cover to be unstable, would have been discovered on inspection. The defendant could not establish that there was any causal relationship between any breach of duty by Finemore’s and Mr Cole’s injury.”
In order to assess properly the contentions presented by the appellant, it was necessary for his Honour to identify with some particularity the extent of the duty of the employer to the plaintiff. Implicitly, his Honour appears to have accepted that the duty included the carrying out of a site inspection, but held that a reasonable inspection would not have disclosed the problem. On that approach, there was a duty, which was breached, but the breach bore no sufficient causal connection with the injury suffered.
On the basis that there should have been a site inspection, the appellant pointed to the evidence of Ms Skelly set out above at [14]. That evidence included her acceptance of the proposition that if she had carried out a risk assessment, she would have –
(a) told the truck drivers not to walk over the pit, and
(b) ensured that the pit lid was safe and secure.
There was no evidence that Ms Skelly had authority to make admissions on behalf of the employer. Her evidence should properly be treated as evidence of her views, formed after the event, but giving weight to her role as an occupational health and safety officer.
His Honour did not deal expressly with that evidence but it may be inferred that he treated it as given with the benefit of hindsight and not as a reflection of the likely steps taken on an inspection had it been carried out prior to the accident. Support for that view follows from his Honour’s conclusion that nothing about the cover lid or its surrounds gave any hint that the lid was unsafe to walk on or constituted a trap to the unwary pedestrian.
The implicit finding that there should have been a site inspection carried with it acceptance of the appellant’s contention that the relationship of Finemore Transport and the appellant would have permitted access to the premises to carry out such an inspection. However, I would accept the finding made by his Honour that such an inspection would not have, on the probabilities, revealed the risk arising from the unstable pit cover. To achieve that, it would have been necessary to take a further step which must at least have included questioning staff of the appellant as to their knowledge of risks arising from use of the depot.
Whether that further step would have revealed the risk in question is a matter for speculation. If the inquiries were limited to managerial staff, the answer might have depended upon the knowledge of the load allocator, Mr Gray, and thus the time of the inquiry and the time at which he became aware of the risk, might have been significant. A further question would have arisen if the inquiries should reasonably have extended to other staff working at the depot, including those who removed the pit covers for cleaning purposes. Whether the relevant information would have been disclosed in such an inquiry is also a matter for speculation.
All of this information was within the appellant’s knowledge and, as appeared from the evidence of the plaintiff, at least two of its employees were present at the trial and might have been called to give evidence. No doubt, in practical terms, the appellant needed to take a strategic decision as to whether such evidence would be harmful to its own case in resisting a finding of negligence and as to whether such evidence was necessary in order to establish liability on the part of the plaintiff’s employer. Whatever the reason may have been, the evidence was not called. The onus lay upon the appellant to establish liability on the part of the employer: see Maricic v Dalma Formwork (Australia) Pty Ltd [2006] NSWCA 174 at [71]. In the present case, the appellant failed to prove the necessary factual basis to establish liability on the part of the employer.
No particular basis of liability was pleaded in the amended defence. The appellant’s case with respect to the employer’s negligence, as conducted at trial, was not based upon any failure on the part of Ms Skelly, or her predecessor, to make inquiries, but upon the basis that either a site inspection should have taken place or the drivers should have been warned generally not to tread on the pit cover: Tcpt, 16/09/08, pp 70-71. Accordingly, his Honour’s finding that the employer was in breach of the only duty said to arise, but that the duty, if fulfilled, would not have revealed the risk, is unassailable. The appeal in this respect also must be dismissed.

Conclusion

For the reasons set out above, the appellant failed to demonstrate, on the facts, contributory negligence on the part of the plaintiff.
Further, its attempt to rely upon a non-delegable duty of care imposed on the employer was conceptually unsound. To the extent that the employer did have a duty to its employee, whilst working on the premises of the appellant, its case in respect of breach was limited to the failure to carry out a site inspection or to warn the drivers not to step on pit covers. As a factual matter, liability of the employer was not established.
The following orders should be made:
(1) Dismiss the appeal.
(2) Order that the appellant pay the respondent’s costs of the appeal.
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LAST UPDATED:
24 July 2009